Vodafone Group eyeing Cable&Wireless Worldwide

Stuart Corner
Tuesday, 14 February 2012 08:55

IT Industry - Deals

Vodafone group is mulling a takeover offer for Cable& Wireless Worldwide.

In response to press reports Vodafone issued a statement saying "Vodafone regularly reviews opportunities in the sector and confirms that it is in the very early stages of evaluating the merits of a potential offer for CWW."

The statement continued: "There is no certainty that an offer will be made nor as to the terms on which any offer might be made. Any offer, if made, will be in cash but Vodafone reserves the right to change the specie of consideration. A further announcement will be made in due course, if appropriate."

The UK's takeover code requires Vodafone to either announce a firm intention to make an offer to state that it has no intention of doing so by 12 March

CWW issued an acknowledgement of the Vodafone announcement saying: "[CWW] confirms that it has the following relevant securities in issue: 2,746,100,010 ordinary shares of 5 pence each; and 2300 convertible bonds of £100,000 each due 2014.

These put the value of the company at £367.3m ($A540m). However reports put the value of the deal at a rumoured $US1b.

CWW was formed in March 2010 through the demerger of the Cable & Wireless Group, one of the world's oldest telcos that could trace its history to the first submarine cable systems in the 19th century.

The spit created Cable & Wireless Communications, which operates local telephone services in 38 countries and territories around the world, and Cable & Wireless Worldwide, which operates a global network serving primarily the needs of multinationals, along with a large UK network. Both companies are listed on the London Stock Exchange, C&W Communications as CWC and C&W Worldwide as CW.

At the time of the demerger CWW said it aimed to be the first-choice provider of mission critical communications for large users of telecoms. It boasted a worldwide network "Stretching to more than 500,000km...[that] includes the UK's largest fibre network for business communications, and provides connectivity to 153 countries."